NBC, Citing Nielsen, Sees A $200 Million Ad Shortfall

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Acknowledging that it had lost ground competitively and economically over the last year, NBC said today that it faced a $200 million shortfall in advertising revenues because of lower prime-time ratings and problems with the ratings system.

NBC executives told affiliate station managers at the close of the annual convention here that advertising revenues this year would be about 8 percent below 1989 revenues, which totaled about $3 billion, largely because of the sharply smaller television audiences being reported by the A. C. Nielsen Company.

All three networks have called the Nielsen reports inaccurate.

Serious Effect Possible

For NBC, the shortfall was unexpected and its impact may be serious, possibly cutting sharply into the network's spending. The decline in viewing as reported by Nielsen has cut into the revenues of the three networks. But because NBC's revenues have been the highest and its competitive position has changed significantly, the network will probably experience the largest reduction.

Still, one executive said NBC expected to report a profit of $500 million this year.

The network's executives also acknowledged that gains made by ABC and Fox Television in attracting younger audiences for prime-time programs had helped cut into NBC's expected revenues.

Brandon Tartikoff, president of NBC Entertainment, said there were disappointing results from a number of prime-time programs that the network had counted on to appeal to younger viewers. These include ''Alf,'' ''The Hogan Family'' and ''Hardball,'' which, he said, had contributed to the shortfall.

Mr. Tartikoff said the network would cut costs in many areas, but not in developing programs.

Free Commercials

Pierson, G. Mapes, president of the the NBC Television Network, said NBC hoped to make up some of the revenue shortfall with increased advertising sales for NBC programs set for this coming fall.

Since January, NBC has not been matching the ratings it had guaranteed advertisers, forcing the network to give advertisers free commercials. The free commercials were a main cause of the lower revenues, one executive said.

Mr. Mapes said the advertising industry had responded favorably to the list of new programs that Mr. Tartikoff announced last month. He repeated, however, NBC's intention to impose a new standard for tying advertising revenues to ratings.

Mr. Mapes said NBC was still considering supporting the plan announced by ABC last week to make statistical adjustments in the ratings returns for next season against the average of the three previous years. The ABC plan would compensate for the declining television audiences that Nielsen has been been reporting.

The most publicized mistake, the departure of Jane Pauley from the ''Today'' show, was the prime concern cited by many station managers. Ms. Pauley's popularity among the stations managers had led many to suggest that she be formally appointed a co-anchor with Tom Brokaw of the NBC ''Nightly News.''

Prime-Time Show for Pauley

When that point was raised in the closed session, the news division president, Michael G. Gartner, said the current plan will remain in effect: Ms. Pauley will be the host of a prime-time program this summer as well as substituting as anchor on the newscast when Mr. Brokaw is on vacation or on the road covering a story.

Asked whether Ms. Pauley might become a full-time take on the co-anchor role full time, several executives at the meeting said that Mr. Gartner told the affiliates, ''Never say never.''

NBC had already made several moves to defuse the discontent among the station managers, who came here worried about the upheaval at the ''Today'' show and the sudden vulnerability in NBC's once dominant prime-time lineup.

Most station managers said they were willing to give NBC time to see whether the addition of Joe Garagiola, Faith Daniels and Katherine Couric would solve the ''Today'' show's recent ratings problems.

NBC also announced a marketing campaign with the McDonald's Corporation, tied to its fall prime-time schedule. The campaign, called ''McMillions on NBC,'' will give away more $35 million over a 28 days in September and October, when the network is scheduled to announce its lineup of new programs.

A version of this article appears in print on June 7, 1990, on Page D00019 of the National edition with the headline: NBC, Citing Nielsen, Sees A $200 Million Ad Shortfall. Order Reprints|Today's Paper|Subscribe